Responses to questions asked during consultation webinars

General questions on the changes

Why change the Building Act 2004?

MBIE is currently progressing a programme of legislative changes to the building system to lift the efficiency and quality of building work, and to provide fairer outcomes if things go wrong. These reforms are focused on making sure people have the information they need to do their job, have clear roles and responsibilities, and can be held to account for poor performance.

Learn more about the changes we are making within the building law reform programme.

There is no legislative change required to the Building Act for the implementation of a code of ethics. The Act already provides for a code of ethics to be prescribed by the Minister of Building and Construction.

The proposed changes to the licensing administration are expected to improve the flexibility and efficiency of the scheme.

The proposed changes to the complaints and disciplinary processes are expected to make the system fairer and more efficient.

View more detailed information on why we are making these changes to the LBP scheme.

Are you finding areas of concern with the LBP scheme as it is?

The purpose of the proposed changes is to strengthen the LBP scheme. The main purpose of the scheme was to allow for building regulations to hold individual builders and designers to account. The scheme has accomplished this. These reforms will strengthen existing requirements and make other parts of the scheme more efficient.

How will these changes improve the quality of design work?

The LBP scheme is structured into seven licensing classes, each based on a specific role or occupation that is crucial to a building’s performance. Building practitioners that offer design services fall within the LBP scheme and must be licensed.

As LBPs, design LBPs will be subject to the proposed code of ethics. Various parts of the code of ethics may be more relevant based on the work or role an LBP is undertaking in a given situation. Additionally, a more efficient complaints and discipline process can aid in identifying repeat offenders of poor quality work and holding them to account.

Will there be more mentoring and support available for LBPs to get better workmanship in the industry?

While this is outside the scope of what we are currently consulting on, this is an idea that should be raised with the Construction Sector Accord.

One of the key objectives of the Construction Sector Accord is to improve how Government partnerships with industry to improve areas, such as the quality of workmanship. The Accord was signed in April 2019, and enables government and industry leaders to achieve improved outcomes for New Zealanders and realise the Accord's shared goals:

• Increase productivity – A productive, value-driven and efficient construction sector able to produce more for each dollar spent.
• Raise capability – A skilled and capable workforce that meets New Zealand’s growing housing and infrastructure needs.
• Improve resilience – Strong, sustainable businesses with the capacity to innovate and adapt to change and disruption.
• Restore confidence, pride and reputation – A high-performing, transparent and trusted sector we can all be proud of.

Learn more about the Construction Sector Accord.

Code of ethics

What are you hoping to gain by introducing a code of ethics?

Introducing a code of ethics will give the Building Practitioners Board clear authority to deal with a broader range of complaints about LBP conduct through disciplinary action. These new powers are expected to act as a deterrent because LBPs can be held to account for poor behaviour.

Currently the Act only allows for disciplinary action to be taken against LBPs for a limited scope of behaviours due to the current threshold that must be met. The new code of ethics will give the Building Practitioners Board additional powers for dealing with the minority of repeat offending LBPs who are responsible for the majority of ethical complaints.

Is there anything specifically new in the proposed code of ethics?

The purpose of the code of ethics is to improve how the scheme can manage ethical behaviour, and therefore adds ethical obligations to the requirements that LBPs must meet.

These obligations will be new, but most LBPs are already working ethically, and so the way they work is unlikely to change. The proposed standards in the code of ethics are not new ways of working, nor are they additional requirements for anyone who is conducting their work in an ethical way currently. For most LBPs these changes won’t affect their day to day activity as they are already behaving ethically. For some LBPs, especially those who repeatedly have complaints made about them, we are looking at ways to change those behaviours

LBPs are currently also subject to existing legislation and regulation, for example health and safety requirements under the Health and Safety at Work Act 2015, and compliance with minimum guarantees under the Consumer Guarantees Act 1993. The code of ethics has been drafted to avoid overlapping with these requirements and cover features of ethical behaviour not currently covered.

Will the LBP code of ethics be based along the line of other codes of ethics?

MBIE looked at a broad range of ethical codes from related sectors as well as reviewing similar codes from a broader range of professions. It was noted that there are broad themes that run through various ethical codes across New Zealand and globally, with specific features tailored to each profession. We drew on these broad themes to create a code of ethics that is clear and concise as well as covers the important ethical obligations. For example:

• Engineering New Zealand's Code of Ethical Conduct provided a model for how ethical obligations could be expressed for the building and construction sector
• the Immigration code of ethics obligations to respect social and cultural norms
• it was also important to consider LBPs not just as individuals but also as business owners, and so ethical obligations relevant to conducting business in responsible manner have been included.

Are there going to be different code of ethics for different LBP types?

In the current proposal we are seeking feedback on a single code of ethics which will be able to be applied to all LBPs regardless of their licence class. We wanted to keep the code of ethics simple and easy to understand.

The code of ethics focuses on general behaviours applicable to all, rather than actions undertaken by a certain licence class only. Various parts of the code of ethics may be more relevant based on the work or role an LBP is undertaking in a given situation.

Will the code of ethics be general rules, or will they be more specific?

We have drafted the code of ethics to be clear and concise. There are four general principles, and sitting under each of these are more specific standards. These standards will help LBPs understand their general obligations, and give LBPs confidence to understand how they are meeting their ethical obligations.

To implement the code, MBIE will deliver an education campaign, including workshops and webinars, along with guidance with clear examples, to ensure LBPs understand their obligations.

Are the board equipped to hear complaints about code of ethics related breaches? What other changes are you considering to support the proposed code?

The Building Practitioners Board currently considers complaints made on LBPs who bring the scheme into disrepute. A relevant factor when appointing a member is their experience, and knowledge on regulating ethical codes will become an important consideration in the future when appointing members. Furthermore, the Board receives support from MBIE, which regulates numerous occupational regulation regimes that include a code of ethics.

In addition, MBIE are also proposing significant changes to the complaints and disciplinary process. Currently the Board acts as the investigator and the decision maker on complaints. MBIE are looking at changing this, by splitting out these functions. Investigations will be carried out by an independent investigator, and the Board will focus its time and effort on judging the case that is brought before it.

This proposal is also part of the proposed changes, and feedback is welcomed on how well this proposed change would support the introduction of the code of ethics.

How do you measure a statement such as "acting professionally"?

MBIE will include standards to help clearly and concisely set out the expectations, so LBPs understand how acting professionally can be measured in practice.

Codes of ethics are common tools, and wording such as 'acting professionally' is commonly used in them. There is a lot of experience and lessons learned in other professions that can be drawn on to ensure that the code of ethics for LBPs is used fairly and improves the effectiveness of the scheme.

Can consumers expect an increased cost of building due to the increased responsibility, accountability, and the extra costs of compliance to the LBPs?

Consumers will not see an increase in costs. The code of ethics is a regulatory tool for managing poor behaviour. It does not does not impose new obligations but gives legislative force to minimum standards expected from LBPs by consumers.

The purpose of introducing the code of ethics is to clearly outline the ethical obligations of LBPs. The majority of LBPs are already meeting these minimum standards, and will not be affected. Other changes proposed are expected to improve the efficiency of the scheme that will also lower the administrative costs, and these savings for the licence holder may be passed onto consumers.

Furthermore, a code of ethics can also help LBPs to understand exactly what is required from them, and give them confidence in the way they behave and interact with consumers and other parts of the building system.

What do you mean by more confidence?

The purpose of the LBP scheme is to help homes be built right the first time, and provide greater confidence for both consumers, and other parts of the building regulatory system such as Building Consent Authorities, or insurers.

The regulation provides an extra layer of assurance in the building system. It tells different parts of the system that these building practitioners must be able to meet a minimum standard, and there are tools available to help them be held to account where necessary.

This is important for potential clients when calculating the levels of risk and the potential costs in a building project.

It also helps to ensure that clients can be certain that they will receive building works to the standard agreed between the client and the LBP, without the need to incur additional costs or inconvenience due to substandard work.

Will you look at lifting the level of competency that is required to enter the LBP scheme?

This is not in scope for this consultation.

MBIE is currently reviewing the number of licence classes and competency requirements of LBPs. Consultation on the outcomes of this review is due in 2021.

Why is it necessary to make these changes if the majority are already professional operators? The non-professional operators will always be there & will not even know about a code of ethics, and this will add extra paperwork.

The scheme was always intended to include the development of a code of ethics, and section 314A of the Building Act allows the Minister of Building and Construction to recommend and implement a code of ethics.

Codes of ethics are really common tools in occupational regulation. The LBP scheme is an outlier in not having a code of ethics in its toolkit. Introducing a code of ethics will create minimum ethical standards so there is no ambiguity, and provide powers for the Board for disciplinary action to be undertaken. This will bring it in line with other occupations we regulate and align with modern best practice.

For most LBPs these changes won't affect their day to day activity as they are already behaving ethically. For some LBPs, especially those who repeatedly have complaints made about them, we are looking at ways to change those behaviours.

How will "policing" of the ethics happen? Just by consumer complaints?

Complaints can come from consumers, BCAs, and the Building Practitioners Board in instances where they see poor ethical behaviour and want to address it.

I've never seen a code of ethics before, how well-defined and detailed will the rules and guidelines be?

MBIE looked at a broad range of ethical codes from related sectors as well as reviewing from a broader range of professions. We noted broad themes running through these ethical codes, such as on working safely, and taking responsibility, and drew on these to create a code of ethics that is clear and concise as well as covers the important ethical obligations.

The code of ethics itself will be drafted around the four main principles, which act like objectives for the scheme, and which are: "work safely", "be aware of the law", "take responsibility", and "behave professionally." Under each of these principles will be a set of standards, which will clarify what this means for LBPs, and the actions they can take to carry out or supervise their work ethically.

MBIE will carry out an information and education campaign, which will include workshops and webinars, to raise awareness about the new obligations.

MBIE will also publish guidelines modelled on those used by other regimes to help people understand their codes of ethics, such as Engineering New Zealand.

Will you have to demonstrate how you're complying with the code?

You will need to demonstrate knowledge on the code of ethics during the licensing renewal process.

Changes to the licensing administration processes

Can an LBP undertake RBW if their licence is in the 'expiry pending' period?

We are proposing two changes to the LBP scheme that relate to the 'expiry pending' period.

The first change is to rename licences that are not renewed in time as expired, rather than suspended. This makes it clearer that there are different reasons for a licence not being active. The word suspended carries other meanings and may create confusion for consumers who may not understand how a relicensing suspension is different from a disciplinary suspension. Regardless of the name change, an LBP will still not be able to carry out or supervise restricted building work when their licence has run out.

The second change we are proposing is the process for LBPs to reactivate their licence where they have not renewed it in time. We are looking at setting it so LBPs will have a period of time after their licence is out of date to complete the renewal process. This grace period will be the 'expiry pending period'. If after this period the LBP has still not renewed their licence, their licence will expire and they will need to complete a reapplication.

Why are you proposing a 90 days expiry pending period?

We are proposing to set the length of the expiry pending period in the LBP rules. Currently, we have landed on 90 days as the length of time. We are proposing 90 days as we have found that the majority of late renewals are currently made in the first 90 days following a relicensing suspension.

Building practitioners holding a licence in the expiry pending period are not allowed to carry out or supervise restricted building work (the same as the current relicensing suspension settings).

Does the pending expiry status remain on the public register for 3 years, or only the expired status?

The public register currently shows suspension and discipline. It will show the expiry-pending period once introduced.

The pending expiry period will remain on the public register for 3 years where the LBP maintains an active licence, and renews their licence either in time or before the end of the expiry-pending period.

Where an LBP has no active licences (because they have been cancelled or expired, as the case may be) the LBP will not be displayed on the public register. This is currently required in the Act and we are not proposing to change it.

Will the process for re-licensing stay the same over the same 2 year period?

The re-licensing process will stay the same, it will just be every 2 years instead of every year. This change aligns licence renewal with when skills maintenance is due.

Do you expect the 2-year renewal will actually save LBP fees? Won't the additional code of ethics complaint process add cost to the scheme?

Shifting to a 2-year renewal process will reduce the cost of running the scheme. These savings are likely to be passed onto the licence holders.

Other proposed changes will also impact the cost of running the scheme, and fees and levies will be reviewed in the near future.

Changes to the complaints and disciplinary process

Will there be a pre-complaint process for Building Consent Authorities (BCAs) to follow to allow a well thought out complaint, and prove that the BCA has tried to upskill and inform the LBP of poor performance?

Currently, complaints are assessed to see if they warrant a full investigation by the Building Practitioners Board. Reasons for not warranting a full investigation include where the complaint is vexatious, or the matter is trivial. We are proposing to change the process so the Board is not both the investigator and the judge for complaints. Instead we will introduce investigators, which are used in other regulatory regimes, and will increase the fairness by ensuring the prosecutor and the judge are separate.

We will also increase the role of the LBP Registrar in triaging complaints, so they can dismiss vexatious or trivial complaints, and complaints that are really minor in nature, earlier in the piece, obviously still after doing some due diligence on the matter.

BCA's do not have a role to quality assure the work of LBPs. Their role is to assure minimum compliance with the Building Code and related provisions. It is the responsibility of the LBP to have the right skills and to perform at the right level, and LBPs should not rely on BCA’s to check their work or educate them.

How will the Registrar make decisions on dismissing complaints if they are satisfied the complaint is frivolous or vexatious, or the subject matter is trivial or inconsequential?

We will develop policies to ensure the risks and broader considerations around dismissing complaints that are vexatious or trivial are accounted for.

MBIE manages other occupational regulation regimes which allow for complaints that are vexatious or trivial to be dismissed, and the same approach can be applied that experience to the LBP scheme.

We are also proposing to allow complainants with complaints that were dismissed for being trivial or vexatious the right to appeal to the Board where they disagree.

Topics outside of scope

Will there be changes to the site licensing class?

This is not in scope of the current consultation, which is focused on introducing a code of ethics, changes to the licensing administration processes, and changes to the complaints and disciplinary process.

There is currently a review of the current licensing classes, including the site licensing class, and competency requirements. The outcomes of this review will be announced and consulted on, which is expected in 2021.

Encouraging better design to build will reduce defects.

The code of ethics will clearly set out expectations for LBPs to take responsibility for the work they are responsible for carrying out or supervising, including design work. If a design LBP is not behaving ethically in providing services, including ensuring design work complies with the Building Code, then they can be held to account under the code of ethics.

A review of the current licensing classes is in progress, including the site licensing class and corresponding competency requirements. The outcomes of this review will be announced and consulted on, which is expected in 2021.

How does this address rogue clients we have to deal with?

The code of ethics is not intended to address issues with rouge clients. The purpose of the code of ethics is to clearly set out the expectations of how LBPs are expected to discharge their obligations under the Act.

It also means if a client tries unfairly to take a complaint against an LBP, these can be dismissed more quickly where they are clearly trivial or vexatious. Or where the complaint progresses, having a clear set of expectations in the code of ethics will aid the LBP in proving where the fault lies.

Is there a way to enforce professional indemnity insurance to prevent a lot of disputes over money?

This is not in scope for this consultation. However, these changes will improve how the scheme can discipline LBPs and hold them to account where needed.

What can be done to protect employees who sign off projects under carpentry licence but bosses get paid the premium for being the LBP?

We are not considering this issue in this proposal. The consultation paper includes information on some other projects underway that may address issues with contract arrangements.

Parliament is considering amendments to the Fair Trading Act 1986 to better protect consumers and small businesses from unfair contract terms and commercial practices.

The Construction Sector Accord is making inroads towards improving contracting and procurement practices, and upskilling the sector.

Can we have a copy of what people have been suspended for or had their licence cancelled?

This information is held in the public register.

The Annual Report released by the Building Practitioner’s Board includes a section on the themes of the complaints it received in the last year.

We are dealing with a company who have been building for 8 months the LBP has only visited twice. Is that okay?

If you are unhappy with the work of an LBP you have hired, consider working it out with them in the first instance. If that does not result in the desired results, the next step could be to determine if there are grounds for a complaint and approach the Building Practitioners Board.

Do all licensed building practitioners need to have a trade qualification?

No, LBPs need to be able to demonstrate they have the right skills, knowledge and experiences during the licensing process. This is not something in scope of the current consultation.

As part of the consultation planned for next year, we will be looking at the competence requirements and the different ways competency of LBPs is assessed.

Why is the LBP scheme self-funded and why doesn’t MBIE fund it?

It is very common in New Zealand and globally for occupational regulation regimes to be self-funded.

Are the LBPs skills maintenance points checked?

LBPs are required to meet skills maintenance requirements to be licensed.

Skills maintenance submissions are reviewed regularly and audits have been carried out. A more robust auditing framework is planned to be rolled out, and updated competence settings will assist to set this up.

Can we use this webinar for our points scheme?

No.

These proposals are not in place yet and do not reflect the knowledge and skills LBPs currently need to demonstrate, and therefore cannot be counted towards current competency requirements.

What could be changed to help me continue to grow my business?

The changes are designed to improve the credibility of the scheme and lift trust in the building system.

Do you see this as a step towards LBPs being self-regulated like electricians?

This is not within the scope of the consultation. These proposals are focused on strengthening the LBP scheme by improving efficiency and effectiveness of the current LBP scheme.

How many people are watching the sessions?

There were 165 people registered to watch in the first webinar on the general overview of the proposed changes, and just over 100 registered for the second webinar that was more of a deep dive into the proposed introduction of the code of ethics.